Ever wonder why Seattle's minimum wage never goes down? Thanks to @CityJournal for publishing my article on the thrilling topic of wage escalators.
https://t.co/Mwi21emSrK
From my op-ed today in @NJMonitor:
"The ABC test rule ... is still so onerous that on October 15, the Senate Judiciary Committee spent nearly two hours asking acting Labor Commissioner Kevin Jarvis how anyone can actually pass the test."
https://t.co/8QqRc7xKV6
How Washington's 2028 income tax interacts with the capital gains tax, and why it creates a big cliff.
How the statute works:
1. Long-term capital gains come out of the income tax base. RCW 82A.04.210(1).
2. But if you owe any capital gains tax, you add back the gains that tax reaches PLUS the capital gains standard deduction. RCW 82A.04.210(3).
3. The capital gains tax you pay is a credit against the income tax. It is nonrefundable, capped at the income tax, and has no carryover. RCW 82A.04.130.
The result: you pay the larger of the two taxes, not both. $1M of wages plus a $1M gain comes to $99,000 total.
Now the cliff. The add-back is all or nothing. It switches on only when you owe some capital gains tax, and when it does, the entire standard deduction (about $278,000 at 2025 levels) comes back into the income tax base at once.
Take someone with $1M of wages:
- $278,000 gain: no capital gains tax, no add-back, $0 tax on the gain.
- $278,001 gain: 7 cents of capital gains tax. That switches on the add-back of the full $278,001, and the income tax jumps about $27,522.
One more dollar of gain, about $27,500 more tax.
Run your own numbers: https://t.co/va5ol9MU1N
@SEIU Shes speaking to the median wage. Which has zero to do with your mandated wage sabotage. The median minimum wage in the US is north of $20 an hour.